Bama Athreya and Tim Newman:
Cadbury and Mars, and other companies, would not be agreeing to these sustainability standards if it were not for years of sustained pressure from consumers in cocoa consuming countries and workers and farmers in cocoa producing countries, as well as the leadership of chocolate companies that have long been committed to a higher ethical standard. These announcements should be viewed as an indication of the strong consumer demand for products that respect workers and the environment and the power of the organized campaigns calling for these improvements.
For advocates and consumers in the US, it is also clear that we need to strengthen our movement for justice and fair trade. It is no coincidence that Cadbury is starting its Fair Trade certification with a bar in the UK and Mars’ first Rainforest Alliance certified product will also premiere in the UK. The movements in the UK for fair food have had a strong impact on many companies operating there and we are more energized and committed than ever to build a stronger movement in the US.
Niche markets [such as Fairtrade and Rainforest Alliance] are a consumer choice and should be welcomed as part of a diverse and creative market place to satisfy consumer’s requirements. But they are a double edged sword in terms of their contribution to progress by developing countries in addressing economic growth, poverty alleviation and the achievement of the Millennium Development Goals.
On the one hand, it is clear that niche markets can improve conditions for those farmers who have the governance and infrastructural framework in which the compliance/certification requirements can be met, and if they are lucky enough to get the support of an international group within a closed supply chain arrangement which is long term in nature.
On the other hand the niche markets can actually serve to delay real progress in achieving fundamental change in the conditions faced by poor farmers and commodity dependent countries by deflecting attention away from the issues of governance and local authority organisation which are vital for poor communities to progress to higher levels of sustainable economic growth.
This is not by design but more as an unintended consequence of the arguments advanced in support of some niche markets which may be based on ideas that have worked in middle income, more organised markets than is generally the case in the small holder context of cocoa. Are niche markets giving a false belief to consumers, governments and donors that the private sector can replace the state?
This may seem an unfair criticism – it is a difficult concept to articulate in a few words since this is not a cocoa specific issue and is further complicated by food security considerations and subsidised northern hemisphere farming. It is also connected with G8 and G20 commitments to developing countries and the failure hitherto to convert the many fine words targeted towards improving the lives of the poorest in the world into deeds via the development agencies of these major countries and their failure to embrace mainstream trade in this massive undertaking.
It is also about where and how the £60 billion per annum of development assistance already given to developing countries is unsustainably used and by public sector failure to provide leadership in promoting mainstream business as part of the solution to fundamental change. The donors/development agencies are part of the problem and have to be part of the solution. I think mainstream and niche markets share concerns in this respect and therefore would benefit from working together rather than separately.
Niche markets have evolved because many consumers want answers and action to what can be perceived as injustice or exploitation of the weakest. But niche is unfortunately an easy way out for many in terms of a false sense of elimination of feelings of guilt or a sense that you are doing the right thing. It is easy for a consumer to go with the headline information without consideration of the realities and unintended consequences of his or her purchasing decisions.
To raise just two examples here:
If you switch to a niche product which has been supplied from a source which is considered more stable in economic or governance terms, then what has happened to the farmer/supplier who you have cast aside?
If a niche market product costs more because its costs include functions that are really the responsibility of the state then do you find the price of the product less attractive as against other competing snack foods?
The broader context is complex and in some respects too much information for the consumer, who just wants to buy a product and feel good about it.
Niche markets have been good for building cooperative spirit and supporting communities. But so have the mainstream but in a much less demonstrative way simply because what we have to try and achieve is a solid platform which is “good for development” and from which all market participants can progress their interests.
Where it all starts to go wrong is in fact in the mainstream market criticism that arises from false and misleading claims from some within the niche markets whether in relation to “guilt free” or “child labour free” sourcing for example and for development agencies to have been easily convinced that the mainstream market is able to take care of the need for public goods at rural community level just because of the claims of some small-scale niche operators.
Such claims from the niche markets and the activities of activists to undermine mediagenic mainstream markets and large companies has the effect of working against the interests of the poorest farmers who rely upon some form of mainstream network to receive any money at all.
Third party certification provides consumers with an easy means to ascertain that the products purchased conform to whatever standards the certification scheme imposes. It increases the level of transparency in the supply chain. That is especially important for products that come from far away.
It also has the potential to decrease the social distance between producers and consumers. It makes it possible for producers in far away countries to become part of the social preference set of consumers in rich countries.
However, there is no guarantee that this will happen. It all depends on the manner in which the manufacturers engage their consumers. Just printing the seal won't do much beyond giving consumers a quick lozenge to make swallowing easier. Engaging with consumers about the challenges and successes experienced by producers, making a foreign world a little more familiar is the only way to achieve this goal. I wonder if the commitment of either company includes that vital aspect of certification.